Manufacturing in Mexico is Being Affected by Robots

While many in the US believe trade with Mexico or China is siphoning off US manufacturing jobs, others point to the rise of automation and argue that it could be robots taking our jobs, even affecting companies manufacturing in Mexico. What do the numbers show?  Briefly, some studies indicate that of the 9 million jobs lost in the US, 8.8 million are attributable to robots, but opinions vary on the question.

The Rise of the Robots

There is no denying that the surge in robotics and automation is here to stay. In the US and other companies manufacturing in Mexico, robots are playing an increasing role in productivity. The US increased the number of robots per man hour worked by 237% between 1993 and 2007. And the Boston Consulting Group has predicted that investment in industrial robots will continue to grow rapidly – at least 10% per year through 2025 in the US and the other primary export nations of the world. Robots are more cost efficient to operate and reprogram when products are replaced or updated. And the cost of automation is dropping. According to the Boston Consulting Group, owning and operating a robotic spot welder, for example, cost approximately $182,000 in 2005 and will cost $103,000 by 2025.

The Impact of Automation on US Jobs and Manufacturing in Mexico

There does apparently seem to be correlation between the rise of industrial robotics in the US and the decline in US manufacturing and Mexico Manufacturing jobs. George Graetz and Guy Michaels researched the rise of automation and asked whether it was robots taking our jobs or other factors. What they found was that, during the 237% rise in robots per man hour worked between 1993 and 2007, there was also a net loss of 2.2 million manufacturing jobs in the US. In fact, since the peak of US manufacturing in 1979, the US has lost over 7 million factory jobs.

While some argue that these jobs were lost to trade with Mexico and China, a study conducted at Ball State University’s Center for Business found that 88% of lost factory jobs were lost due to the impact of industrial robots and other domestic factors. The evidence that it is robots taking our jobs seems well-founded. But does correlation equal causation?

The Silver Lining

Two years ago, the Wall Street Journal spotlighted the work of an economics professor at MIT, David Autor.  He argues that robots are not taking our jobs. He and others point to the other large export nations of the world and their high reliance of robotics. For example, Germany uses 300% more robots per man hour than the US does, yet they have not experienced such a loss in factory jobs as experienced by the US. Another observation these researchers point out is that productivity (and thus GDP) is on the rise with the advent of automation. Are robots taking our jobs while improving our overall standard of living? The relationship between automation and job growth and economic prosperity is still unclear. The question is far more complex than current political rhetoric affords.

According to Ball State University the U.S. has become more productive due to Robots. A study of 1998 to 2012 shows that all sectors increased productivity by 32%.  Ball State studies show that 2000 levels of productivity when compared to 2010 levels that the U.S. would have required 20.9 million workers instead of the 12.1 million that were actually working.  That is 8.8 million jobs that are no longer there due to robots.

So, the question becomes, “just what does America do to offset this loss of jobs from implementation of robots?”. How does it affect manufacturing in Mexico for US companies?   The answer is in more advanced technical education of all Americans.  Electronics, computer sciences, automation, electronics engineering, constructing robots, programming, systems designs, etc.  The opportunities for the American citizens that prepare for this change will do well as America as a country is continuing to be more productive than ever.

For information on such subjects as this the reader is encouraged to visit our Blog at